In light of the state of emergency,[1] corporations under the jurisdiction the Ontario Corporations Act (the”OCA”) are temporarily[2] being given more flexibility in holding their directors’ and members’ meetings. This is good news for non-profits and charities under the jurisdiction of the OCA who have looming deadlines to hold their AGMs or who have governing documents which prohibit them from holding meetings virtually or via conference call. We have summarized how the temporary measures published on March 31st, 2020 will affect OCA not-for-profit corporations’ meetings: [3]
- Electronic meetings. Even if your
corporation’s governing documents expressly prohibit it, during the emergency
period:
- Meetings of the members of a corporation may be held over the phone or electronically. A member who, through those means, votes at the meeting or establishes a communications link to the meeting is deemed to be present at the meeting.
- A meeting of directors (or of a committee of directors) may be held over the phone or electronically, but the technology must permit all persons participating in the meeting to communicate with each other simultaneously and instantaneously. A director participating in the meeting by those means is deemed for the purposes of this Act to be present at the meeting.
- Election extensions. The meeting of the members for the election of directors is generally required to be held within the first three months of every year. In light of the emergency, the deadline is extended to no later than the 90th day after the day the emergency is terminated.
- AGM extensions. While normally
corporations must generally hold their first AGM within eighteen months of incorporation
and every subsequent AGM no more than fifteen months apart,
- if the last day to hold an AGM falls within the period of the declared emergency, the corporation can delay the AGM to no later than the 90th day after the day the emergency is terminated; and
- if the last day to hold an AGM is within thirty days after the day the emergency is terminated, the corporation can delay the AGM to no later than the 120th day after the day the emergency is terminated.
We will continue to monitor the situation as it evolves.
By: Lex Klombies
Lex
Klombies is a charity and non-profit lawyer at Drache Aptowitzer LLP. She can
be reached at LKlombies@drache.ca.
[1] A state of emergency was declared on March 17, 2020 at 7:30am in response to the COVID-19 pandemic: https://www.ontario.ca/orders-in-council/oc-5182020
[2] These measures all last until the end of the state of emergency, or until a designated number of days after the state of emergency terminates. As you might expect, the day the emergency will be terminated is unknown. The state of emergency was originally set to terminate at the end of March 31st, 2020, but has been extended a further 14 days. See: https://files.ontario.ca/solgen-oic-extension-past-march-31-2020-03-30.pdf
[3] See: O. Reg. 107/20: Order Under Subsection 7.1 (2) of the Act – Meetings For Corporations, under Emergency Management and Civil Protection Act, R.S.O. 1990, c. E.9, available online: https://www.ontario.ca/laws/regulation/r20107. Note that these regulations are retroactive to March 17th, 2020, the date the emergency was declared.